Toyota’s (TM) unexpected warning to get repairs may hurt its long-term uptrend. The firm warned 50,000 vehicle owners, albeit for old models such as the 2003-2004 Corolla, to stop driving and to repair their Takata airbag inflators.
Car owners know Toyota best for its quality and reliability. Firms like General Motors (GM), Stellantis (STLA), and Ford (F) have frequent recalls. This adds to their expenses. Look out for weakness in automotive stocks.
Tuesday’s stock market will look ahead to the Federal Reserv
e’s monetary policy meeting, which begins today and through tomorrow (Jan. 31). Traders do not expect Fed Chair Jerome Powell would cut interest rates. Still, any toughening stance about clamping down on persistent inflation, high home costs, and rising oil prices might weaken stock prices.
The firming up in oil prices may add to inflation. However, major oil firms like ConocoPhillips (COP), Chevron (CVX), and ExxonMobil (XOM) are long due for an energy stock rally.
According to BTIG, WTI crude broke through a downtrend and a $75 horizontal resistance. WTI crude could effectively rise to $85 per barrel. BTIG is counting on tensions in the Middle East to boost oil prices.
In the merger and acquisition space, Amazon (AMZN) terminated its deal to buy automated vacuum firm iRobot. iRobot’s CEO Colin Angle, also the founder, will step down. The company will cut 31% of its staff. Amazon will pay nearly $100 million in a termination fee to iRobot. Watch for IRBT stock to catch buyers today.
